BSE Sensex at 57,000 and NSE Nifty at all-time high of 17,000: Santosh Meena
Indian market touched all-time high for BSE Sensex and NSE Nifty in today's trading session. Market sentiment is still bullish and the strong trends in global markets are keeping Indian stocks firm. Markets are still looking positive and we can expect many stocks to touch their lifetime highs in September. Market outlook by Santosh Meena, Head of Research, Swastika Investmart follows....
The festive season has begun in Indian and Indian equity markets as well. Indian equity markets are showing strong resilience and climbing all walls of worry that is a clear sign of a strong bull market. Nifty and Sensex are at record highs and marching towards 17000/57000 levels respectively.
Globally liquidity is one of the important factors which can be attributed to this rally. Most of the central banks across the globe are supporting their economy through easy monetary policy where US Fed is continuing its dovish stance that is leading to lower US bond yields and weak US dollar which are always considered positive for emerging markets like India.
Other than monetary policy we saw strong fiscal supports by governments across the globe which is helping the global economy to recover sharply from a tough time. The Indian government also announced a lot of fiscal stimulus and now we are seeing its significant impact on the Indian economy.
Indian economy is witnessing strong recovery despite being hit hard by the Covid second wave. It is most likely that we are not going to be hit by the third wave as badly as expected earlier on the back of speedy vaccination and some kind of herd immunity.
The technology sector is the leader of this bull run where Covid19 acted as a key catalyst for the exponential growth of the Indian IT industry that is also helping headline indices Nifty and Sensex to continue their upward journey.
One of the beauties of this bull market is that our market is very resilient where Nifty and Sensex start to consolidates instead of falling if there is FIIs' selling while they start to move up sharply whenever FIIs show any buying interest.
We believe that we are in a classical bull run and it may continue for a long time while we may see some intermediate corrections and that will act as great buying opportunities. In the near term as well Indian Markets may outperform where rising covid19 cases in the US could be a negative factor while inflation could be another risk factor amid rising commodity prices.
Strong macro data may continue to support our markets whereas FIIs' outflow in china due to new regulations could be long-term positive for the Indian markets.
As of now, the monsoon is weak in Indian and that could be a sentiment dampener if the situation doesn't improve from here.
Technically, 16900-17000 is an immediate resistance area for the Nifty; above this, we can see a parabolic move towards the 17350-17500 zone. On the downside, the 16700-16500 area will act as a strong support zone where only a decisive move below 16500 can lead to any short-term weakness.